Franklin BSP Realty Trust, Capstead Mortgage Complete Merger
October 19, 2021 | Rica Dela Cruz
Franklin BSP Realty Trust Inc., formerly known as Benefit Street Partners Realty Trust Inc., and Capstead Mortgage Corp. have completed their previously announced merger.
After the close of trading October 18, Capstead ceased to be publicly traded on the NYSE, and at the open of trading October 19, the combined company started trading on the same stock exchange under the ticker symbol FBRT.
At the effective time of the merger, each issued and outstanding share of common stock of Capstead was converted into the right to receive 0.3288 newly issued shares of Franklin common stock; cash consideration of 21 cents per share from Franklin; and cash consideration of 73 cents per share Franklin’s external manager, Benefit Street Partners LLC. Franklin will pay cash in lieu of any fractional shares of its common stock that would otherwise have been received as a result of the merger.
Registered holders of Capstead’s common stock will have their Franklin common shares posted to new accounts at SS&C Technologies Holdings Inc., the transfer agent for Franklin. Meanwhile, beneficial holders of Capstead’s common stock will have their Franklin common shares posted to their individual accounts at their broker or financial institution, in accordance with the policies and procedures of such broker or financial institution.
Additionally, following completion of the transaction, each outstanding share of Capstead’s 7.50% series E cumulative redeemable preferred stock was converted into the right to receive one newly issued share of Franklin’s 7.50% series E cumulative redeemable preferred stock. At the open of trading on Oct. 19, the Franklin preferred stock began trading on the NYSE under the ticker symbol FBRT PRE.
Pursuant to the merger agreement, Pat Augustine, Michelle Goolsby and Gary Keiser, who are former independent directors of Capstead, were named to Franklin’s board.
Common stock repurchase programs amounting to $100 million will be available to support the combined company’s common stock trading level starting roughly four weeks after the closing of the merger.
Source: S&P Global Market Intelligence
